Small Business Equity Tracker 2026 (British Business Bank)

Summary

• UK smaller businesses raised £12.3 billion of equity investment across 2,002 deals in 2025, representing a 4% decline in value and a 17% decline in deal count compared to 2024.p.6
• Artificial Intelligence companies captured a record 44% share of all UK smaller business equity investment in 2025 (£5.4 billion across 527 deals) and 26% of all announced equity deals.p.6
• As of May 2026, the UK had 46 unicorn-status companies, with 67% having received backing from a British Business Bank equity programme.p.21
• British Business Bank equity programmes supported approximately 15% of all UK smaller business equity deals and 16% of total equity investment value between 2023 and 2025.p.48
• University spinouts experienced a sharp contraction in 2025, with deal volumes falling 33% to 218 deals and total investment value halving (-51%) to £1.1 billion.p.62

Key insights

1. The UK-US venture capital investment gap widened between 2023 and 2025, with UK VC investment averaging 0.60% of GDP compared to 0.79% in the United States.p.8
2. London's share of UK equity investment value fell from 60% in 2024 to 57% in 2025, driven by substantial investment growth in the North West (82%), Scotland (74%), and the South West (104%).p.6
3. All-female founder teams secured only 2% of total UK equity investment value across 7% of deals in 2025, showing no change from 2024 levels.p.44
4. Fundraising intervals diverged in 2025, lengthening for seed-stage companies to a median of 14.4 months while shortening for growth-stage businesses to 15.1 months.p.30
5. The UK ranked second globally behind the US with 1,075 spinout VC deals between 2021 and 2025, generating approximately 5 VC-backed spinouts per $1 billion of government and higher education R&D.p.58